Kompetenz-Kompetenz: Varying Approaches and a Proposal for a Limited Form of Negative Kompetenz-Kompetenz

Article by: Ashley Cook

2014 PEPP. L. REV. 17 (2014)

An arbitral tribunal’s power to decide its own jurisdiction is its kompetenz-kompetenz and is a “conceptual cornerstone[] of international arbitration as an autonomous and effective form of international dispute resolution.” The inherent requirement that parties to a valid arbitration agreement (AAG) must honor that agreement by arbitrating their disputes precludes national courts from tampering with the result of a valid arbitral award. National courts must respect and uphold valid AAGs as enshrined in Article II(3) of the New York Convention: The court of a Contracting State, when seized of an action in a matter in respect of which the parties have made an agreement within the meaning of this article, shall, at the request of one of the parties, refer the parties to arbitration, unless it finds that the said agreement is null and void, inoperative[,] or incapable of being performed.

However, because the Convention does not provide a firm definition as to what defects qualify as “null and void, inoperative[,] or incapable of being performed,” States are free to exercise significant discretion. State discretion under the Convention extends to when and under what circumstances national courts will hand over jurisdictional decisions to tribunals. The result has been unreliable practices of kompetenz-kompetenz in different nations across the globe, calling into question whether kompetenz-kompetenz is truly the “inherent power” of arbitral tribunals.

This paper analyzes differing views and approaches to kompetenzkompetenz and proposes a workable framework of kompetenz-kompetenz for the future. Part II provides an overview of the general principle of kompetenz-kompetenz, discussing the views of some of the leading international commercial arbitration scholars on kompetenz-kompetenz. Part III analyzes the approaches taken by the United States and the United Kingdom and uses them as helpful illustrations of kompetenz-kompetenz in practice. Part IV notes the shortcomings of the aforementioned approaches and proposes a limited form of negative kompetenz-kompetenz as the solution. Part V concludes.